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Answer to Question #40046 in Finance for Xyrenne Gayle Lorenzo

Question #40046
A heat exchanger is needed in a chemical process. If interest is 9% compounded quarterly, determine which of the following is cheaper by comparing the capitalized costs:

a.Exchanger A costs P 155,350 with a scrap value of P 15,000 and a useful life of 7 years.

b. Exchanger B costs P 165,850 with a scrap value of P18,500 and a useful life of 10 years.
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